34. Last-Minute Deal : The End of the Cypriot Banking Sector

In the end, despite all his pleading, threats and horsetrading, Cypriot President Nicos Anastasiades had no option but to bow to the terms of international lenders. Early on Monday morning, the Euro Group of euro-zone finance ministers agreed a bailout of €10 billion ($13 billion) for the tiny Mediterranean island. In return, the Cypriot government agreed to radically scale down its oversized banking sector. Bank customers with deposits of over €100,000, including wealthy Russians who had deposited funds in Cyprus, will lose a large part of their assets.

Anastasiades caved in after days of resistance. "We have a deal that is in the interest of the Cypriot people and the EU," the conservative politician said after the meeting in Brussels. His finance minister, Michalis Sarris, said the agreement would prevent a disastrous exit from the euro zone.

The other 16 euro finance ministers breathed a sigh of relief that the cliffhanger was finally over. "We have a better solution than that reached last week," said Euro Group Chief Jeroen Dijsselbloem.

German Finance Minister Wolfgang Schäuble said: "This is bitter for Cyprus, but we now have the result that the (German) government always stood up for."